Kevork S. Hovnanian, 86; Founded Building Company

By BARRY MEIER

Published: September 27, 2009

Kevork S. Hovnanian, who came to the United States from Iraq and started a construction company that became one of the nation's largest home builders, died on Thursday in Manhattan. He was 86 and lived in Rumson, N.J.

Hovnanian Enterprises Inc. of Red Bank, N.J., announced his death on its Web site but did not disclose the cause. He founded a building company, with his three brothers in 1959.

Last year, Hovnanian, a publicly traded company that operates in 18 states, was the sixth-largest builder of homes and residences in the country, based on revenue. Affected by the nationwide housing downturn, it reported a net loss of $1.1 billion for the year that ended in October 2008.

Mr. Hovnanian was among the developers who transformed the shape of suburbia in the 1970s and 1980s by building inexpensive town houses and condominiums for young families who were first-time buyers.

Even among competitors, he gained a reputation as a builder of bare-bones homes who kept prices low. In the early 1980s, for example, the typical Hovnanian condominium residence was a two-bedroom, two-bathroom dwelling that cost about $30,000. In his developments, Mr. Hovnanian kept prices down by omitting the amenities, like swimming pools and community buildings, that other builders used to attract buyers.

''There are limited recreation facilities going in because people have little time for socialization,'' Mr. Hovnanian told The New York Times in 1983, explaining his philosophy.

By 1989, his company had sold more than 30,000 condominiums and other residences in states stretching from New Hampshire to Florida. The projects were so popular that they sometimes sold out over a weekend. Mr. Hovnanian also operated a finance company that made loans to buyers, who sometimes bought more than one residence, including some as investments.

Since then, the company has built more than 200,000 other homes. And in recent years, it has expanded its portfolio to include the construction of medium-price homes, luxury homes and retirement communities with recreational facilities.

Mr. Hovnanian, who was of Armenian descent, fled Iraq with his brothers and other family members in the late 1950s as a result of political upheaval there. In 1986, he fulfilled a promise he had made to himself during his escape by building an Armenian Apostolic church in Long Branch, N.J.

He also contributed money to help build medical facilities in the New York area, including the K. Hovnanian Children's Hospital at Jersey Shore University Medical Center in Neptune, N.J.

Mr. Hovnanian and his three brothers, Hirair, Jirair and Vahak, put in $1,000 each, in addition to a borrowed $20,000, to start the company, Hovnanian Enterprises Inc. said in a news release on its 50th anniversary. The other brothers left the business in 1969. Hirair and Vahak, both of Middletown, N.J., survive.

In 1988, his son, Ara K. Hovnanian, succeeded him as president of Hovnanian Enterprises, replacing his father as its chief executive in 1997. The elder Mr. Hovnanian remained chairman of the company until his death. Besides his son, who lives in New York, he is survived by his wife, Sirwart; four daughters, Sossie Najarian, Esto Barry and Lucy Kalian, all of Rumson, N.J., and Nadia Rodriguez, of Boston; and 13 grandchildren.